Appeals partly allowed, remitted for fresh consideration, penalty grounds dismissed as premature

The Tribunal partly allowed the appeals, remitting some issues for fresh consideration and directing adjustments or verifications for others. The grounds related to penalty proceedings were dismissed as premature.

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Issues:
1. Validity of final assessment order due to non-service of DRP's directions.
2. Transfer pricing adjustment on payment of Royalty for use of technology.
3. Disallowance under section 14A of the Act.
4. Non-granting of deduction for Education Cess and Secondary higher education cess.
5. Non-granting of deduction under section 80G.
6. Short deduction of TDS credit.
7. Initiation of penalty proceedings under section 271(1)(c).
8. Procedure under section 144B of the Act.
9. Transfer pricing adjustment on payment of Royalty.
10. Consideration of returned income during scrutiny assessment under section 143(3).
11. Short granting of credit of TDS.
12. Levy of interest under section 234C.

Analysis:

Issue 1: Validity of final assessment order due to non-service of DRP's directions
The assessee contended that the final assessment order was invalid due to non-service of the DRP's directions. However, the Tribunal noted that the communication of direction to the assessee was not a statutory requirement. The Tribunal found that the direction was promptly e-mailed to the assessee, and hence, dismissed this ground as devoid of merit.

Issue 2: Transfer pricing adjustment on payment of Royalty for use of technology
The Transfer Pricing Officer (TPO) made adjustments in the Royalty payment transaction, leading to a transfer pricing adjustment. The Tribunal approved the segregation of Royalty payment from other transactions and directed the matter to the DRP for further consideration based on similar cases from previous years.

Issue 3: Disallowance under section 14A of the Act
The Tribunal remitted the matter to the Assessing Officer (AO) for fresh consideration based on directions from previous orders.

Issue 4: Non-granting of deduction for Education Cess and Secondary higher education cess
The Tribunal decided against the assessee based on precedents from previous cases.

Issue 5: Non-granting of deduction under section 80G
The Tribunal directed the AO to verify and allow the deduction of Rs.6.00 crore if not earlier allowed, after providing an opportunity of hearing to the assessee.

Issue 6: Short deduction of TDS credit
The AO was directed to verify the assessee's contention and allow the necessary credit if not earlier allowed.

Issue 7: Initiation of penalty proceedings under section 271(1)(c)
The Tribunal dismissed the ground as premature.

Issue 8: Procedure under section 144B of the Act
The ground became infructuous due to statutory amendments with retrospective effect.

Issue 9: Transfer pricing adjustment on payment of Royalty
The Tribunal followed previous orders and directed accordingly.

Issue 10: Consideration of returned income during scrutiny assessment under section 143(3)
The Tribunal directed the disposal of the application made by the assessee under section 154 and adjustments to the income figures if warranted.

Issue 11: Short granting of credit of TDS
The AO was directed to verify the assessee's contention and decide accordingly.

Issue 12: Levy of interest under section 234C
The Tribunal directed the AO to examine the computation of interest under section 234C.

In conclusion, the Tribunal partly allowed the appeals, remitting some issues for fresh consideration and directing adjustments or verifications for others. The grounds related to penalty proceedings were dismissed as premature.

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